After reporting a loss of 19 cents a share,Monsanto Co. (NYSE:MON) announced that it will be cutting 2,600 jobs to cut back on costs. The company warned that profits will continue to be weak going into 2016.
The agricultural giant is one of many corporations that are struggling to adjust to a decline in world commodity prices. The lost jobs equates to about 12% of Monsanto’s workforce.
Following in the footsteps of Glencore Plc (NYSE:GLEN) and DuPont Co (NYSE:DD), Monsanto is being proactive in combating the effects of declining commodity prices, which have affected farmer incomes for two years in a row.
Along with cutting jobs, the company will also re-prioritize some of its R&D efforts and will leave the sugar-cane business to save $300 million a year. Despite its reported losses, Monsanto still maintains that it will meet its goal of doubling per-share earnings by 2019.
The company states that it will accelerate its$3 billion share repurchase program, which was initially suspended during its failed bid for Syngenta AG.Between buybacks, cost savings, improved agriculture and sales of a new GM soybean (Intacta Pro), the company expects to return to 20% per share earnings growth by 2017.
Monsanto’s shares dropped to $87.75, down 0.4% in early trading. Shares are down 27% this year.